Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NASDAQ Stock Market LLC To List Options on Trust Issued Receipts in $1 Strike Intervals, 35113-35115 [2010-14964]
Download as PDF
<![CDATA[
Federal Register / Vol. 75, No. 118 / Monday, June 21, 2010 / Notices
The Exchange has requested that the
Commission waive the 30-day operative
delay to permit the Exchange to
compete with other exchanges whose
rules permit the listing of similar short
term options series.18 The Commission
believes that waiver of the operative
delay is consistent with the protection
of investors and the public interest
because the proposal is substantially
similar to a rule of another exchange
that has been approved by the
Commission.19 Therefore, the
Commission designates the proposal
operative upon filing.20
At any time within 60 days of the
filing of the proposed rule change, the
Commission may summarily abrogate
such rule change if it appears to the
Commission that such action is
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–NASDAQ–2010–073 on the
subject line.
sroberts on DSKD5P82C1PROD with NOTICES
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–NASDAQ–2010–073. This
file number should be included on the
subject line if e-mail is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
18 See
supra notes 4–5 and accompanying text.
Securities Exchange Act Release No. 59824
(April 27, 2009), 74 FR 20518 (May 4, 2009) (SR–
CBOE–2009–018).
20 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
19 See
VerDate Mar<15>2010
15:46 Jun 18, 2010
Jkt 220001
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. All comments received will
be posted without change; the
Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–
NASDAQ–2010–073 and should be
submitted on or before July 12, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.21
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–14966 Filed 6–18–10; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
35113
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The NASDAQ Stock Market LLC
proposes to amend Chapter IV,
Securities Traded on NOM, Section 6,
Series of Options Contracts Open for
Trading, to allow the Exchange to list
options on Trust Issued Receipts in $1
strike price intervals.
The text of the proposed rule change
is available on the Exchange’s Web site
at https://
www.nasdaq.cchwallstreet.com, at the
principal office of the Exchange, on the
Commission’s Web site at https://
www.sec.gov, and at the Commission’s
Public Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change. The text of
these statements may be examined at
the places specified in Item IV below.
The Exchange has prepared summaries,
set forth in sections A, B, and C below,
of the most significant aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
[Release No. 34–62295; File No. SR–
NASDAQ–2010–070]
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change by NASDAQ
Stock Market LLC To List Options on
Trust Issued Receipts in $1 Strike
Intervals
June 15, 2010.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that on June 10,
2010 The NASDAQ Stock Market LLC
(‘‘NASDAQ’’ or ‘‘Exchange’’) filed with
the Securities and Exchange
Commission (‘‘SEC’’ or ‘‘Commission’’)
the proposed rule change as described
in Items I and II below, which Items
have been prepared by NASDAQ. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
21 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
PO 00000
Frm 00144
Fmt 4703
Sfmt 4703
The purpose of the proposed rule
change is to amend Chapter IV,
Securities Traded on NOM, Section 6,
Series of Options Contracts Open for
Trading, by adding additional text to
Section 6(d)(v) to allow the Exchange to
list options on the Trust Issued Receipts
(‘‘TIRs’’), including HOLding Company
Depository ReceiptS (‘‘HOLDRS’’), as
defined in Supplementary Material to
Section 6 at .01(b), in $1 or greater strike
price intervals, where the strike price is
$200 or less and $5 or greater where the
strike price is greater than $200.3
Currently, the strike price intervals for
options on TIRs are as follows: (1) $2.50
or greater where the strike price is
$25.00 or less; (2) $5.00 or greater where
the strike price is greater than $25.00;
and (3) $10.00 or greater where the
strike price is greater than $200.4
3 HOLDRS are a type of Trust Issued Receipt and
the current proposal would permit $1 strikes for
options on HOLDRS (where the strike price is less
than $200).
4 See Chapter IV, Section 6(d). See also Securities
Exchange Act Release No. 61347 (January 13, 2010),
75 FR 3513 (January 21, 2010) (SR–NASDAQ–2010–
003).
E:\FR\FM\21JNN1.SGM
21JNN1
35114
Federal Register / Vol. 75, No. 118 / Monday, June 21, 2010 / Notices
sroberts on DSKD5P82C1PROD with NOTICES
The Exchange is seeking to permit $1
strikes for options on TIRs (where the
strike price is less than $200) because
TIRs have characteristics similar to
exchange-traded funds (‘‘ETFs’’).
Specifically, TIRs are exchange-listed
securities representing beneficial
ownership of the specific deposited
securities represented by the receipts.
They are negotiable receipts issued by a
trust representing securities of issuers
that have been deposited and held on
behalf of the holders of the TIRs. TIRs,
which trade in round-lots of 100, and
multiples thereof, may be issued after
their initial offering through a deposit
with the trustee of the required number
of shares of common stock of the
underlying issuers. This characteristic
of TIRs is similar to that of ETFs which
also may be created on any business day
upon receipt of the requisite securities
or other investment assets comprising a
creation unit. The trust only issues
receipts upon the deposit of the shares
of the underlying securities that are
represented by a round-lot of 100
receipts. Likewise, the trust will cancel,
and an investor may obtain, hold, trade
or surrender TIRs in a round-lot and
round-lot multiples of 100 receipts.
Strike prices for ETF options are
permitted in $1 or greater intervals
where the strike price is $200 or less
and $5 or greater where the strike is
greater than $200.5 Accordingly, the
Exchange believes that the rationale for
permitting $1 strikes for ETF options
equally applies to permitting $1 strikes
for options on TIRs.
The Exchange has analyzed its
capacity and represents that it believes
the Exchange and the Options Price
Reporting Authority have the necessary
system capacity to handle the additional
traffic associated with the listing and
trading of $1 strikes, where the strike
price is less than $200, for options on
TIRs.
2. Statutory Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
of the Act 6 in general, and furthers the
objectives of Section 6(b)(5) of the Act 7
in particular, in that it is designed to
promote just and equitable principles of
trade, to remove impediments to and
perfect the mechanism of a free and
open market and a national market
system, and, in general to protect
investors and the public interest, by
allowing the Exchange to list options on
5 See Chapter IV, Supplementary Material to
Section 6 at .01(b), (permitting $1 strikes for options
on Units covered under Section 6(d) also known as
ETF options).
6 15 U.S.C. 78f(b).
7 15 U.S.C. 78f(b)(5).
VerDate Mar<15>2010
15:46 Jun 18, 2010
Jkt 220001
TIRs at $1 strike price intervals. The
Exchange believes that the marketplace
and investors expect options on TIRs to
trade in a similar manner to ETF options
and this filing would allow the
marketplace and investors the ability to
trade options on TIRs. The Exchange
further believes that investors will be
better served if $1 strike price intervals
are available for options on TIRs, where
the strike price is less than $200.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
NASDAQ does not believe that the
proposed rule change will result in any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not significantly affect the
protection of investors or the public
interest, does not impose any significant
burden on competition, and, by its
terms, does not become operative for 30
days from the date on which it was
filed, or such shorter time as the
Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act 8 and Rule 19b–
4(f)(6) thereunder.9
The Exchange has requested that the
Commission waive the 30-day operative
delay. The Commission believes that
waiver of the operative delay is
consistent with the protection of
investors and the public interest
because the proposal is substantially
similar to a rule of another exchange
that has been approved by the
Commission.10 Therefore, the
Commission designates the proposal
operative upon filing.11
8 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires the self-regulatory organization
to submit to the Commission written notice of its
intent to file the proposed rule change, along with
a brief description and text of the proposed rule
change, at least five business days prior to the date
of filing of the proposed rule change, or such
shorter time as designated by the Commission. The
Commission has waived the five-day pre-filing
requirement in this case.
10 See Securities Exchange Release No. 34–62141
(May 20, 2010), 75 FR 29787 (May 27, 2010) (SR–
CBOE–2010–036).
11 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
9 17
PO 00000
Frm 00145
Fmt 4703
Sfmt 4703
At any time within 60 days of the
filing of the proposed rule change, the
Commission may summarily abrogate
such rule change if it appears to the
Commission that such action is
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–NASDAQ–2010–070 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–NASDAQ–2010–070. This
file number should be included on the
subject line if e-mail is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. All comments received will
be posted without change; the
Commission does not edit personal
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
E:\FR\FM\21JNN1.SGM
21JNN1
Federal Register / Vol. 75, No. 118 / Monday, June 21, 2010 / Notices
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–
NASDAQ–2010–070 and should be
submitted on or before July 12, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–14964 Filed 6–18–10; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62296; File No. SR–Phlx–
2010–84]
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of a Proposed Rule Change by
NASDAQ OMX PHLX, Inc. To Establish
a Short Term Option Program
June 15, 2010.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that on June 14,
2010, NASDAQ OMX PHLX, Inc.
(‘‘Phlx’’ or ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(‘‘SEC’’ or ‘‘Commission’’) the proposed
rule change as described in Items I and
II below, which Items have been
prepared by the Exchange. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
sroberts on DSKD5P82C1PROD with NOTICES
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange is filing with the
Commission a proposal to amend Rule
1012 (Series of Options Open for
Trading) and Rule 1101A (Terms of
Option Contracts) in order to list option
series that expire one week after being
opened for trading; to add the definition
of Short Term Option Series to Rule
1000 (Applicability, Definitions and
References) and Rule 1000A
(Applicability and Definitions); and to
make non-substantive changes to the
language of Rule 1012 and Rule 1101A.
The Exchange requests that the
Commission waive the 30-day operative
delay period contained in Exchange Act
Rule 19b–4(f)(6)(iii).3
12 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 17 CFR 240.19b–4(f)(6)(iii).
1 15
VerDate Mar<15>2010
15:46 Jun 18, 2010
Jkt 220001
The text of the proposed rule change
is available on the Exchange’s Web site
at https://
nasdaqomxphlx.cchwallstreet.com/
NASDAQOMXPHLX/Filings/, at the
principal office of the Exchange, on the
Commission’s Web site at https://
www.sec.gov, and at the Commission’s
Public Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The purpose of this proposal is to
amend Rules 1012 and 1101A to
establish a short term option program on
the Exchange (‘‘STO Program’’ or ‘‘Short
Term Option Program’’) by proposing to
add new Commentary .11 to Rule 1012
and new subsection (b)(vi) to Rule
1101A in order to list option series that
expire one week after being opened for
trading (‘‘Short Term Option Series’’ or
‘‘STO’’). The Exchange also proposes to
add the definition of Short Term Option
Series to Rule 1000 and Rule 1000A;4
and to make non-substantive changes to
conform the language of Rule 1012 and
Rule 1101A and delete unnecessary
language.
The Commission approved the Short
Term Option Program on a pilot basis in
2005 and approved permanent
establishment of the Short Term Option
Program in 2009 on behalf of Chicago
Board Options Exchange (‘‘CBOE’’) in its
Rules 5.5 and 24.9.5 Thereafter, CBOE
4 Short Term Option Series is defined as: A series
in an option class that is approved for listing and
trading on the Exchange in which the series is
opened for trading on any Thursday or Friday that
is a business day and that expires on the Friday of
the next business week. If a Thursday or Friday is
not a business day, the series may be opened (or
shall expire) on the first business day immediately
prior to that Thursday or Friday, respectively.
Proposed Rules 1000(b)(44) and 1000A(b)(16).
5 CBOE refers to its short term option program as
the ‘‘Weeklys Program.’’ See Securities Exchange
Act Release Nos. 52011 (July 12, 2005), 70 FR 41451
(July 19, 2005) (SR–CBOE–2004–63) (approval order
PO 00000
Frm 00146
Fmt 4703
Sfmt 4703
35115
amended Rules 5.5 and 24.9 to permit
opening Short Term Option Series not
just on Friday but also on Thursday.6
The Exchange’s proposal is based
directly on the short term option
program (Weeklys Program) in CBOE
Rules 5.5 and 24.9.
Specifically, the Exchange proposes to
establish a Short Term Option Program
for non-index options (e.g., equity
options and ETF options) in new
Commentary .11 to Rule 1012; and for
index options in new subsection (b)(vi)
to Rule 1001A. The Short Term Option
Program allows the Exchange to list and
trade Short Term Option Series. Thus,
after an option class has been approved
for listing and trading on the Exchange,
the Exchange may open for trading on
any Thursday or Friday that is a
business day (‘‘Short Term Option
Opening Date’’) series of options on that
class that expire on the Friday of the
following business week that is a
business day (‘‘Short Term Option
Expiration Date’’). If the Exchange is not
open for business on the respective
Thursday or Friday, the Short Term
Option Opening Date will be the first
business day immediately prior to that
respective Thursday or Friday.
Similarly, if the Exchange is not open
for business on the Friday of the
following business week, the Short
Term Option Expiration Date will be the
first business day immediately prior to
that Friday.7
Under the STO Program, the
Exchange may select up to five
approved option classes on which Short
Term Option Series could be opened.
The Exchange also may list Short Term
Option Series on any option classes that
are selected by other securities
exchanges that employ a similar
program under their respective rules.8
establishing Weeklys Pilot Program) and 59824
(April 27, 2009), 74 FR 20518 (May 4, 2009) (SR–
CBOE–2009–018) (approval order permanently
establishing Weeklys Program).
Other options exchanges have also established
short term option series pilots (but have not made
them permanent). See Securities Exchange Act
Release Nos. 52012 (July 12, 2005), 70 FR 41246
(July 18, 2005) (SR–ISE–2005–17) (approval order
establishing short term option series pilot); 52013
(July 12, 2005), 70 FR 41471 (July 19, 2005) (SR–
PCX–2005–32) (approval order establishing short
term option series pilot); 52014 (July 12, 2005), 70
FR 41244 (July 18, 2005) (SR–AMEX–2005–035)
(approval order establishing short term option
series pilot).
6 See Securities Exchange Act Release No. 62170
(May 25, 2010), 75 FR 30889 (June 2, 2010) (SR–
CBOE–2010–048) (notice of filing and immediate
effectiveness allowing opening Short Term Option
Series on any Thursday or Friday).
7 See proposed Commentary .11 to Rule 1012 and
Rule 1101A(b)(6).
8 See proposed Commentary .11(a) to Rule 1012
and Rule 1101A(b)(6)(A).
E:\FR\FM\21JNN1.SGM
21JNN1
]]>Agencies
[Federal Register Volume 75, Number 118 (Monday, June 21, 2010)]
[Notices]
[Pages 35113-35115]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-14964]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62295; File No. SR-NASDAQ-2010-070]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NASDAQ Stock Market LLC To
List Options on Trust Issued Receipts in $1 Strike Intervals
June 15, 2010.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on June 10, 2010 The NASDAQ Stock Market LLC (``NASDAQ'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I and II below, which Items have been prepared by NASDAQ. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The NASDAQ Stock Market LLC proposes to amend Chapter IV,
Securities Traded on NOM, Section 6, Series of Options Contracts Open
for Trading, to allow the Exchange to list options on Trust Issued
Receipts in $1 strike price intervals.
The text of the proposed rule change is available on the Exchange's
Web site at https://www.nasdaq.cchwallstreet.com, at the principal
office of the Exchange, on the Commission's Web site at https://www.sec.gov, and at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of the proposed rule change is to amend Chapter IV,
Securities Traded on NOM, Section 6, Series of Options Contracts Open
for Trading, by adding additional text to Section 6(d)(v) to allow the
Exchange to list options on the Trust Issued Receipts (``TIRs''),
including HOLding Company Depository ReceiptS (``HOLDRS''), as defined
in Supplementary Material to Section 6 at .01(b), in $1 or greater
strike price intervals, where the strike price is $200 or less and $5
or greater where the strike price is greater than $200.\3\
---------------------------------------------------------------------------
\3\ HOLDRS are a type of Trust Issued Receipt and the current
proposal would permit $1 strikes for options on HOLDRS (where the
strike price is less than $200).
---------------------------------------------------------------------------
Currently, the strike price intervals for options on TIRs are as
follows: (1) $2.50 or greater where the strike price is $25.00 or less;
(2) $5.00 or greater where the strike price is greater than $25.00; and
(3) $10.00 or greater where the strike price is greater than $200.\4\
---------------------------------------------------------------------------
\4\ See Chapter IV, Section 6(d). See also Securities Exchange
Act Release No. 61347 (January 13, 2010), 75 FR 3513 (January 21,
2010) (SR-NASDAQ-2010-003).
---------------------------------------------------------------------------
[[Page 35114]]
The Exchange is seeking to permit $1 strikes for options on TIRs
(where the strike price is less than $200) because TIRs have
characteristics similar to exchange-traded funds (``ETFs'').
Specifically, TIRs are exchange-listed securities representing
beneficial ownership of the specific deposited securities represented
by the receipts. They are negotiable receipts issued by a trust
representing securities of issuers that have been deposited and held on
behalf of the holders of the TIRs. TIRs, which trade in round-lots of
100, and multiples thereof, may be issued after their initial offering
through a deposit with the trustee of the required number of shares of
common stock of the underlying issuers. This characteristic of TIRs is
similar to that of ETFs which also may be created on any business day
upon receipt of the requisite securities or other investment assets
comprising a creation unit. The trust only issues receipts upon the
deposit of the shares of the underlying securities that are represented
by a round-lot of 100 receipts. Likewise, the trust will cancel, and an
investor may obtain, hold, trade or surrender TIRs in a round-lot and
round-lot multiples of 100 receipts.
Strike prices for ETF options are permitted in $1 or greater
intervals where the strike price is $200 or less and $5 or greater
where the strike is greater than $200.\5\ Accordingly, the Exchange
believes that the rationale for permitting $1 strikes for ETF options
equally applies to permitting $1 strikes for options on TIRs.
---------------------------------------------------------------------------
\5\ See Chapter IV, Supplementary Material to Section 6 at
.01(b), (permitting $1 strikes for options on Units covered under
Section 6(d) also known as ETF options).
---------------------------------------------------------------------------
The Exchange has analyzed its capacity and represents that it
believes the Exchange and the Options Price Reporting Authority have
the necessary system capacity to handle the additional traffic
associated with the listing and trading of $1 strikes, where the strike
price is less than $200, for options on TIRs.
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act \6\ in general, and furthers the objectives of Section
6(b)(5) of the Act \7\ in particular, in that it is designed to promote
just and equitable principles of trade, to remove impediments to and
perfect the mechanism of a free and open market and a national market
system, and, in general to protect investors and the public interest,
by allowing the Exchange to list options on TIRs at $1 strike price
intervals. The Exchange believes that the marketplace and investors
expect options on TIRs to trade in a similar manner to ETF options and
this filing would allow the marketplace and investors the ability to
trade options on TIRs. The Exchange further believes that investors
will be better served if $1 strike price intervals are available for
options on TIRs, where the strike price is less than $200.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
NASDAQ does not believe that the proposed rule change will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not significantly
affect the protection of investors or the public interest, does not
impose any significant burden on competition, and, by its terms, does
not become operative for 30 days from the date on which it was filed,
or such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \8\ and Rule 19b-
4(f)(6) thereunder.\9\
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78s(b)(3)(A).
\9\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the self-regulatory organization to submit to the
Commission written notice of its intent to file the proposed rule
change, along with a brief description and text of the proposed rule
change, at least five business days prior to the date of filing of
the proposed rule change, or such shorter time as designated by the
Commission. The Commission has waived the five-day pre-filing
requirement in this case.
---------------------------------------------------------------------------
The Exchange has requested that the Commission waive the 30-day
operative delay. The Commission believes that waiver of the operative
delay is consistent with the protection of investors and the public
interest because the proposal is substantially similar to a rule of
another exchange that has been approved by the Commission.\10\
Therefore, the Commission designates the proposal operative upon
filing.\11\
---------------------------------------------------------------------------
\10\ See Securities Exchange Release No. 34-62141 (May 20,
2010), 75 FR 29787 (May 27, 2010) (SR-CBOE-2010-036).
\11\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
---------------------------------------------------------------------------
At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-NASDAQ-2010-070 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NASDAQ-2010-070. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments,
all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for Web site
viewing and printing in the Commission's Public Reference Room, 100 F
Street, NE., Washington, DC 20549, on official business days between
the hours of 10 a.m. and 3 p.m. Copies of the filing also will be
available for inspection and copying at the principal office of the
Exchange. All comments received will be posted without change; the
Commission does not edit personal
[[Page 35115]]
identifying information from submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NASDAQ-2010-070 and should be submitted
on or before July 12, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
---------------------------------------------------------------------------
\12\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-14964 Filed 6-18-10; 8:45 am]
BILLING CODE 8010-01-P
